Member Info for TrekMadone

He actually said we are ‘well funded’. There is a difference. The £10m remains in treasury. Imo this company will not be fully funded until we produce.

‘The three well exploration programme remains fully funded from the Company's EXISTING cash resources’

The £10m has been earmarked for...

· Appraisal well drilling: £2.4 million
· Enhanced well completion: £0.5 million
· 3D seismic programme: £3.8 million
· Feasibility Studies and licence fees: £1.2 million
· Additional operational contingencies, working capital and expenses: £2.1 million

Other than options for Lorna and usual broker inclusive ‘fee warrants’, there were no warrants issued with the last raise which is indeed unusual for a resource company. You’d expect a half warrant as a norm.

There are 71.5m options and warrants outstanding = 11.4% of the company. The majority are subject to a 2 year lock in so one cannot bet on conversions providing a short term boost.

If Tai-2 comes in and can be appraised happy days. They also have two other targets that they have now decided to drill.

If Tai-2 doesn’t come in then they will have to decide on longer term finance. They could raise a small amount, say £6m before TD on the 2nd drill or they could carry on with a view to re-appropriate funds from ‘treasury’.

This is a huge acreage, I would prefer they had cash for another 3 drills before they get to the fourth and final drill. I think keeping the cash raised ring fenced for appraisal is a better way forward than re-appropriating it.

This is proving a very exciting journey, they have ops & finance options all the way. I am not concerned about any dilution now as when we have success it will be minimal SP wise but as an investor it is worth thinking these options through.

Trek

£5

What a great piece of research. I have been working through the numbers to understand the potential divi. The exchange rates are a pain! And here someone has already done it!

Thanks

Trek

Hi legal,

We share a few stocks. I hold CHF as well and was in He1 just after IPO.

A head scratcher indeed! I have been through the company presentations a couple of times now. Every time after reading I think buy more!

The only copper play in my Pf that is bucking the trend is PXC (USA).

Both PXC and CCZ are cashed up. Both have a decent bod. Both have great assets in safer juro’s where there are proven resources, historical mining nearby. Both have huge upside discovery potential. Etc

The main difference I can see is CCZ is early stage and has Zambia. That will need cash and covid travel risk.

PXC have a huge range of metals and have made a statement about no more dilution to get to production. I have my reservations but that’s what they said.

I would say CHF are similar to CCZ on the curve. Even LND that have placed and are close to MRE their SP is now below the 30p placing at 25.7p and you know CHF are a tad below the 10p placing.

ECR are below their last 2.2p placing. THR are just above their placing but below it to sell. And here is probably the biggest discount to SP placing!

It just seems that the dilution and cash grabs is what’s knocking juniors atm as well as the summer horridays!

I don’t know if there is a wider trend with MM’s collecting shares on a macro basis or not, ready for an uptrend. You could write a narrative both ways. US $1tn Keynesian spend just gone through senate to China slowing down.

Take your pick but for sure commodity stocks are cheap atm and some way off ath’s.

https://www.mining.com/120-year-chart-shows-commodities-have-never-been-this-undervalued/

I just keep hearing the old adage ringing in one’s ear with this lot....

‘the market can stay irrational longer than you can stay solvent!’

We really need some decent news on a SP and macro level as I expect many need 100% gains her to get back to evens!

Good luck with your investments

Trek

Hi Alas,

Virolens is a ‘turnstile test’. There is no other on the market yet but others are likewise progressing holographic imaginary for detecting pathogens.

There really isn’t a sufficient moat to ‘Warren Buffet’ this business. It’s high tech, relatively low margin work. It’s usp is it’s high end tech, worldwide coverage and ability to deliver bespoke products at volume with excellent customer links. You can see all the blurb on the webpage. There are many others in this market.

It’s a great recovery play and is moving under its own steam. A Virolens announcement will supercharge the SP!

LFT’s have their place but they really would have worked better in conjunction with covid passports. The narrative around testing and passports seems to have taken a back seat to vax and booster vax and get on with it. The UK is becoming a paradigm for that model.

Even with the narrative changing things like cruise ships, airports, schools, doctors surgeries, police stations, nursing homes etc Could cope better with a rapid covid test than a cumbersome up to 15min LFT. At the moment it’s really down to the individual to decide if they take an LFT before visiting granny even if both are double jabbed.

We know Virolens has MHRA approval. We know of the Scotland trials and Heathrow. We know the financial results included numbers ‘aside from Virolens’ but other than that it’s been very quiet.

If I was looking to enter now I would be looking at the order book in the results, the outlook, the divi cover and BoD skill with acquisitions.

If you think it can stand-alone on those fundamentals then you get Virolens as a potential share price super charger event!

Without the potential of Virolens I wouldn’t have invested. Ironically now I have I have been very pleased with this companies performance especially dealing with supply side constraints.

Usual caveats

Trek

Hi Camden,

There is no time limit on a short. The shares are usually borrowed from a larger holder on a % fee basis.

The ‘shorter’ then sells the stock and has to buy them back to return to their owner at an agreed time. That could be weeks or years.

It’s not like futures and options where puts or calls expire on given dates.

Nor is it like CFD’s where you would run a margin and a book betting for and against price movements.

Trek

I reduced here after they placed. I cannot fathom how they possibly haven’t got the US projects farmed out. It’s clear that they can’t do it themselves, certainly with any pace. They don’t have the skills or the cash.

There is an appetite for deals in the US. PXC where I have a decent holding recognised they couldn’t progress one of the cobalt projects quickly enough so farmed it down getting excellent royalty terms and up front cash. That cash is being used to move another find towards a mine.

THR have plenty of similar opportunities but unfortunately the management are not up to the task. I thought it had changed and things would improve with Nicole but am sadly disappointed.

If/when this spikes to a penny I will be out with the rest at around evens.

Good luck with your investments

Trek

Shows a latent SP strength here if we can absorb 1m sells with a reasonably tight spread. Excellent liquidity!

Obviously not where we want the SP to be but you have to drop the share price to a level that clears out sellers by being compelling for buyers. That’s what gives liquidity and volume.

The opposite can also be true.

Once we are through that then the changing of the guard is complete and only then can you move to the next level which imo in this case is up from here.

It’s how things are meant to work.

Where it doesn’t work is with low volumes, low liquidity, silly spreads, no news. Then it’s a slow death by what feels like a thousand cuts!

Thankfully there is a reasonable market for the stock here.

Trek

“Have they completed Phase 3?”

Regeneron’s end points....

https://www.roche.com/media/releases/med-cor-2021-03-23.htm

As always a range of patients will need a range of therapeutic’s.

SNG001 will still be needed imo for more severe /cytokines.

Trek

Hi TDT,

My fear was 58p but I have more confidence now that this is the bottom. I may put in my last tranche today as TSX pulled up from lows and market due a bounce.

Why, Looking at the macro..

POG has held around 1780. The flash crash in POG mysteriously preceded the release of the fed minutes so was already in the price.

Market ‘taper tantrum’ is dummies out over monetary tightening. I think the market kick back will mean a shallow glidepath. It’s the unknown that worries. Fed will be worried about recovery. Many recovery numbers quoted are from low base for electioneering purposes! Delta is a worry. Recovery is tender.

After Jackson Hole next week we could see a strong equity rally if Fed don’t taper as sharply.

Fed dovish on rates, no hike until 23 earliest. That maybe confirmed.

‘Transient inflation’ they will live with 4% as a blip. But that means negative 10 year treasuries. (1.7-4=-2.3%)

Dollar strength is for sure a headwind to gold but how much has it been talked up?

I reckon there is an incentive to have a period of inflation to erode debt. Holding physical gold is smart as it can act as asset backed security or you can sell. You can see why they want a lower gold price short term!

So JH next week will have a clearer picture. I am optimistic tapering will be a damp squib!

Also we we soon be out of the summer silly season!

Question wether they will raise here. Never say never. The last at 88p was for ops and related costs for the ramps.

The higher AISC means profitability is delayed. Well larger part anyway. But remember they only needed C$10m for the ramps and took 17m.

That extra 7m is quite a significant amount. Because the real commercial money won’t flow through until next year I think they will raise but not yet. They will or should look to get costs down and grades up first. I also would like to think any raise is well north of 100p and just a bridge/increase expo.

All said it's like everyone ( the company and major shareholders etc) other than us PI want this SP lower but I think in the 50’s now would be a step too far. There must be a lot of companies running a sliderule over PUR now they have the data.

Absolute stonking buy imo at this level if you have a 6 month outlook or more.

Good luck with your investments

Usual caveats.

Trek

It’s an IPO or the ADS shares. This will give them a ‘full dual US listing’.

The remaining ‘main shares’ not taken up by IPO will move from the OTC to the NASDAQ.

That will complete a full ADR listing.

More detail will follow in the prospectus.

There will be an arbitrage between the NASDAQ & LSE listing which when complete will be interesting as it will be more relative than OTC/ADS LSE listing.

PXC are following a similar path. They have a US bank (Mellor) buying in London up to 30% of PXC stock starting September for US OTC trades. Similarly they could then later when as advanced as Argo move to a full dual listing.

Usual caveats

Trek

I looked in this afternoon with a view to adding more. The price to buy then was 1.499. It really wasn’t worth it for me as typically I had only just added at 1.58! I was hoping for much lower to help get my average below 2 but agree with BCB, for new money you gotta relish days like this!

This is just an equity ‘taper tantrum’ the Dow has recovered from early drops to flat now. The market will soon get used to easing. It’s not anything like a black swan. It’s dummies out!

Interestingly there was a flash crash earlier in the POG then shortly after the Fed minutes came out! Now the POG has been flat at 1780.

The primary headwind for gold is usually interest rates. The Fed have said the economic recovery is still fragile. They don’t see a rate rise before 23. Inflation is viewed as ‘transitory’ and will pull back.

If the Fed are not buying their own debt or corporate bonds to the same extent that can mean demand isn’t there and liquidity will tighten. Atm the dollar is strengthening but I wouldn’t guarantee the narrative they expect to play out as portended unless of course they gradually wean the markets off the QE steroids. If that’s the case it’s slow, doesn’t go ‘far enough’ and comes back to gold.

Gold has had its technical pull back. Basel 3 has put the demand on physical.

Physical gold can be seen as a way of paying debt. Inflation erodes debt and gold ‘hedges inflation’.

Resource stocks are relatively disconnected from the commodities surge. They are at the cheapest now they have ever been.

It’s impossible to time the bottom when stock picking but now when sentiment is on its knees is imo time to buy copper and gold.

The biggest leverage for the maximum return is fully funded, autonomous small cap explorers in safe jurisdictions. That’s why I am piling into here and a few choice others that have great assets, sound corporate structure and their own uniqueness. But you gotta have the stomach for the volatility and only invest money you don’t need quickly.

https://www.mining.com/120-year-chart-shows-commodities-have-never-been-this-undervalued/

Usual caveats

Trek

Going to be interesting how they play this. Obviously they have learnt a lot from TAI-1 and this is a copy. I wouldn’t expect another sidetrack.

We know they can drill to 880m relatively problem free. I guess they will go as far as the seal, case and DST. Gather data and pause for breath.

This is still exploration. Will they appraise what they have or will they carry on deeper into the Karoo. I don’t think they know themselves yet. All will depend on the results.

Doing the same thing and expecting a different result is pretty much out of the question especially expecting a change of luck from only 20m away.

I don’t know what kit they have or what setups the rig can drill in terms of borehole size but there must be a great deal of confidence from Mitchell’s.

This drill will cost, albeit it’s obviously the cheapest option. Whether it counts as hole 2 in its entirety from our 3/4 well campaign is not clear. £2m on the first and this one will be much less.

I am hoping for a discovery and then for them to place.

If and I actually think it’s unlikely that this doesn’t come up with something then at least we have another opportunity. Get the SP up on another type of trap then go to market.

A good result here and a placing at a much higher SP would be amazing. £6m will give us 3 more wells and working capital. Cash will be needed at some point. DM has to box clever now with the finances and the ops.

Don’t be surprised when it happens. This is still just the beginning of a long campaign and being ahead on finance is as critical to shareholder returns as ops. DM imo has proven with the last placing and getting excellent terms with Mitchell’s that he is very capable.

Usual caveats

Trek

£5

It’s pretty unusual to get major corporate news in the August silly season.

Markets having a bit of a taper tantrum atm, mainly following US. When they get the numbers and see it’s a gradual taper with interest rates on hold until 23 there will be a following relief rally. Volumes are down. That will change in Sept/Oct.

Usual caveats

Trek

Thanks TDT and a great price imo!

There was liquidity back again in the afternoon. So they must have got stock from somewhere or they just sit on hands before over committing ahead of TSX!

We tend to be at a slight premium to TSX which is blue at 65p. So hoping for a little lift tomorrow. Well actually I was ready for 58p just in case but i’d rather we got out of this fall. This leap frogging averaging down has been too much like hard work!

Good luck with your investments

Trek

“How do you set an exit SP strategy that is realistic ? ”

The sensible thing is to always take profits along the way. Then what I do is find another company.

Likewise I have over 20 companies across our accounts. The weighting varies significantly. A few are less than £5k where I had to take losses maybe due to bad timing/poor research or both but I may keep a foot in the door to benefit from any upside. E.g. GDR. I was convinced they’d sell their testers now I am not sure and it’s turned against me so I sold at a loss but the amount I have left could recover that loss or I could average down. Cash = choices.

Where I am very confident I will buy in tranches like at PXC where I now have a large position for me.

Often you get a dip for no reason, low volume aim shenanigans. Like at ONC. In which case you gotta grit your teeth and BTFD! It’s now recovered from 150’s to 190. Happy days!

Or like PUR where I have traded down by selling and rebuying from memory to 76p from a 120 average. All with the same money. When it takes off, I am pretty sure it will I will slice again hopefully for profit.

Then there is the ride the winners. If you get one that’s rising like TGA, sell or take some off of the losers and top up. I sold AVCT, a share I loved and piled into TGA. I can always buy AVCT later if so inclined.

Then you get the ‘lifers’. I bought TTG for a recovery play and have just held it. It’s doing fine on it’s own under the radar.

I guess there is no one size fits all answer imo you have to adapt each situation accordingly and match that to your objectives. I only gave the examples so you can look at the charts. None are recommendations.

If I didn’t want to be an active investor i’d buy a fund. My strategies don’t fit others nor would I impose them.

Good luck with your investments.

Trek

Sukarno = skarn

Clever iPad!

Trek

The EM survey will be interesting.The magnetite Sukarno gives a good signal.....

“Furthermore, Dr. Rodgers concluded that the higher grade silver mineralisation was focused in areas within the magnetite-bearing skarn that had been subjected to a superimposed event, possibly highly acidic, wherein the later-stage silver-bearing fluids leached the magnetite skarn. Because the silver mineralisation only occurs in iron-rich portions of the skarn, which are dominated by magnetite, then those areas near the contact of Mackay Granite and White Knob limestone with magnetite development are thought to be favorable targets for higher grade silver.

Because the lack of discernible outcrop at Red Star makes it difficult to determine the underlying geology, Dr. Rodgers has recommended the use of ground magnetic surveying, coupled with geologic mapping, to better define future drilling targets. The Company will therefore be scheduling a ground magnetics survey at the Red Star area as soon as weather and ground conditions permit, in order to optimize the next phase of the drilling programme.”

The Ag content is pretty extraordinary...

“The drilling results from 2018 and 2020 were very promising, with silver grades as high as 1,100 g/tonne (32 oz/t) and lead grades above 21%”

The electromags will help target this complex structure.

Quotes lifted from company presentation.

Trek

I am still here. That was my 400k buy at 9:14 today.

I have sold elsewhere to add here and have enough for one more buy. My average is now a tad over 2p. With the right news (obviously) this can get through 2p quickly.

2p May provide some resistance for obvious reasons but not all placing investors would sell as good news will keep a few in.

I think a lot of the warrants have washed through now other than the ones at higher levels.

I have 22 resource stocks on my watchlist. All are down. It’s a sector thing. Come September when volumes pick up it may turn. It’s almost like the MM’s are in collusion collecting stock by pushing prices down. Very weird! When it turns it can do so very quickly catching folk out.

I reckon this around the nadir now...

https://www.mining.com/120-year-chart-shows-commodities-have-never-been-this-undervalued/

Trek

Is that 39 trades of 331 shares 37 of them at exactly the same time to the second. Mmmm.

I can only think they are market maker liquidity schemes.

Don’t know if itsyou has a view?

Trek

Got filled at 64p at 10:35. I am surprised but took ages!

Trek